Six Steps to Affordable, Clean Heat
In the face of rising energy demands and the urgent need to decarbonize, the planning and implementation of regional heat transmission highways represent a pivotal step towards a more sustainable and resilient energy future. These heat highways are designed to transport heat over long distances from abundant sources to areas of demand, bridging the gap between rural or industrial heat producers and urban centres. The initial focus on regional areas offers distinct advantages. Regions typically have more space, which allows for the deployment of large-scale infrastructure with fewer logistical challenges compared to densely packed urban environments. In addition, regional zones provide access to a variety of steady heat sources—such as industrial waste heat, large-scale renewable energy production and the possibility of Large Thermal Energy Storage (LTES) that are difficult to harness in the heart of major cities where space and resource limitations are more pronounced.
By starting regionally, we can tap into these resources and build the infrastructure that will eventually expand into urban areas, ensuring a more balanced and reliable heat supply. Cities, with their ultra-high heat demands, will benefit from the established groundwork laid in these surrounding areas, allowing for a smoother and more cost-effective transition towards a Net Zero future.. This phased approach ensures that we maximize efficiency, minimize disruptions, and create a resilient energy backbone that supports the growing demand for decarbonized heat.
This guide provides a structured approach to developing regional heat transmission highways and city-wide green heat grids. It draws on insights from successful projects and is designed to help local authorities assess technical and economic feasibility, engage stakeholders, and create a roadmap for implementation.
We have identified six key steps to ensure that a successful delivery of a regional Heat Transmission Highway and City-Wide Green Heat Grids:
Step 1: Forming A Guiding Coalition
Step 2: Conducting a Feasibility Study
Step 3: Preparation for Construction and Roll-Out
Step 4: Construction of the Heat Transmission Highway
Step 5: Expand to Domestic Buildings and Additional Heat Sources
Step 6: Realize a City-Wide Green Heat Grid
Step 1: Form A Guiding Coalition
Purpose: Establish clear leadership and roles to ensure effective coordination throughout the project.
Activities:
- Appoint a Project Manager: Identify a project manager to lead the feasibility study and coordinate with stakeholders, ensuring timely progress.
- Establish a Steering Group: Form a Steering Group of key stakeholders to provide oversight, align efforts, and guide strategic decisions.
- Involve Technical Experts: Engage experienced conceptual design engineers and economists to support technical assessments and economic modelling to justify the overall business case and viability for proceeding with the project prior to commencing any design or sizing.
Expected Outcome: A well-organized team with defined roles and responsibilities, ensuring that the feasibility study and project development are managed effectively.
Step 2: Conduct a Feasibility Study
Objective: The feasibility study is a critical first step in defining the vision, scope, and economic viability of the project. It helps to shape a clear roadmap and engage with stakeholders, investors, and policymakers. The key objectives of the feasibility study include:
Detailing the Initial Phase
Developing an Overarching Vision
Defining the Scope of the Project
Determine the Budget and Timeline
Assess the Financial Viability
Conduct a Socio-economic Analysis
Develop a Comprehensive Roadmap
Detailing Initial Phase
Focus on defining the extent of the first phase, laying the groundwork for assessing capital investment needs (CAPEX) and operational costs (OPEX).
Developing an Overarching Vision
Outline a vision for the heat transmission project and divide it into clear project phases, each with a defined scope.
Define the Scope
Purpose: The scoping study sets the initial focus for project development and future implementation, helping to refine the project’s vision. It identifies the first key infrastructure investments, such as connecting a primary heat source to an initial transmission line.
Activities:
- Identify Heat Sources: Pinpoint large-scale heat sources, such as Energy from Waste (EfW) plants, industrial facilities, or power stations, that can provide a steady heat supply for the network.
- Propose a Transmission Line: Define a potential starting point for the heat transmission line that connects the selected heat source to initial anchor load buildings (e.g., commercial or public buildings).
- Develop a Phase-by-Phase Plan: Outline a development plan that transitions from the initial setup to a long-term vision, such as connecting the regional network to a nearby city, industrial zone or energy park.
- Workshops and Stakeholder Engagement: Hold workshops to refine the scoping study, align plans with existing data, and discuss the initial phase’s technical and economic feasibility.
- Prepare a Scoping Memo: Summarize the results of the scoping study in a memo that defines project phases and outlines data needs.
- Technical Solutions: Specify the technical solutions needed for Phase 1, including a preliminary assessment of the necessary CAPEX and OPEX.
Expected Outcome: A defined initial project scope that serves as the basis for detailed technical, financial, and economic assessments.
For inspiration please take a look here:
Determine Budget and Timeline
Purpose: Select an experienced project engineer specialising in large-scale infrastructure to define the budget and timeline for conducting the feasibility study and implementing the first project phase.
Activities:
- Estimate Manhours: Break down the expected work hours for each activity, including the scoping study, economic analysis, socio-economic analysis, and roadmap development.
- Set Consultancy Rates: Determine average consultancy fees and include additional costs, such as travel and accommodation for workshop participants.
- Create a Timeline: Estimate the total project duration, allowing time for data collection, stakeholder engagement, and analysis.
Expected Outcome: A clear budget and timeline that outlines the expected costs and duration of the feasibility study and initial phase, helping stakeholders plan resources effectively.
Assess Financial Viability
Purpose: The economic analysis is crucial for determining the project’s financial feasibility and understanding the investment required
Activities:
- Define Design Data: Specify key design data for the regional heat network for each phase, such as: number of households, expected heat load to supply over a year, structure of district heating distribution, overall design data for transmission line e.g. pipe size, flow temperature, pressure etc.
- Heat Production Assessment: Develop the expected heat production profile from the selected heat source(s) over the year, including seasonal variations throughout the year.
- Calculate CAPEX and OPEX: Establish a detailed estimate of the capital costs for building the transmission line and distribution network, as well as the expected operational costs. It may be necessary to involve an experienced design engineer with insights into district heating distribution systems to assess CAPEX relating to establishing a distribution network and installation to domestic buildings.
- Compare Heat Prices: Assess expected heat prices for consumers against current heating options, such as natural gas or individual heat pumps (without subsidy).
- Discuss Results with Stakeholders: Present findings during workshops to determine if adjustments are needed or if the project should move forward.
Expected Outcome: A detailed understanding of project costs, investment needs, and the potential heat price for consumers, enabling informed decision-making and stakeholder discussions.
Conduct a Socio-Economic Analysis
Purpose: The socio-economic analysis helps demonstrate the broader benefits of the project, making a case for policy support and investment.
Activities:
- Use Existing Data: Utilize data from the scoping study and economic analysis as a foundation for the socio-economic assessment.
- Project Energy Price Scenarios: Analyse future energy price forecasts and baseline scenarios to understand the project’s impact under different conditions.
- Identify Subsidy Opportunities: Explore potential subsidy programs or grants that could support the project, such as those aimed at renewable heat systems or energy efficiency.
- Highlight Non-Energy Benefits: Identify additional benefits, such as job creation, economic development opportunities, and industrial growth.
- Present Findings to Policymakers: Share findings with local and regional policymakers to secure their support, demonstrating the alignment of the project with climate goals and community benefits.
Expected Outcome: A detailed socio-economic report that supports grant applications, policy engagement, and investor discussions.
Develop a Comprehensive Roadmap
Purpose: A roadmap provides a strategic plan for guiding the project through development and implementation, ensuring coordination across different sectors and stakeholders.
Strategic Tracks:
- Policy Track: Define how to secure support from local, regional and national governments, ensuring alignment with broader policy goals, climate targets and Net Zero strategies.
- Stakeholder: Identify key stakeholders and ownership, including local authorities, energy sector players, and private investors. Establish their roles in the project’s development and operation.
- Financial Track: Detail capital-raising strategies, risk mitigation measures, and possible financial guarantees to attract investment.
- Technical Track: Plan for the technical development of the network, including engineering work, integrating future heat sources or LTES systems and expanding to new areas or towns.
- Communication Track: Develop an outreach plan to inform and engage with residents and stakeholders about the project’s benefits, fostering interest and buy-in for future connections.
- Ownership Model: Whether the project has been initiated by a Private Heat Network Developer or by the local council the ongoing and future ownership model will need to be determined. Whether it be: Private, Public, Public-Private or Joint venture between multiple councils (the typical model in Denmark for Heat Transmission Companies).
Expected Outcome: A clear and actionable plan for each aspect of project development, enabling a coordinated approach to implementation.
Step 3: Preparation for Construction and Roll-Out
Purpose: As with any other large-scale infrastructure project there are a number of procedures that must be completed to ensure successful and on time delivery of the project.
Activities:
- Design Work: Detailed design work, such as pipe design, sizing and layout.
- Planning: Planning applications and obtaining all necessary permits and
permissions i.e. environmental and excavation of roads. - Sourcing Low-Cost Heat: Sourcing heat and securing contracts with heat suppliers e.g. Energy from Waste (Efw) Plants. This includes the contractual obligations such as duration and amount of heat delivered.
- Consumer Roll-Out: A phase by phase plan should be laid out for consumer connections with an emphasis of customer centricity (making it as easy, hassle free and low-cost for consumers to connect). District Heat As Service is proving the most popular method in Denmark in the gas-to-heat conversion.
To find out more about this model:
Expected Outcome: To ensure that successful construction and delivery of the project can commence.
Step 4: Construction of the Heat Transmission Highway
Purpose: With planning completed, construction of the initial heat transmission line can commence, connecting the identified heat source to the first set of consumers.
Activities:
- Construct Transmission Line: Build the infrastructure needed to transport heat from the heat source to anchor load buildings.
- Install Distribution Systems: Establish the distribution network to deliver heat to larger consumers in the first phase, such as public buildings or commercial facilities.
- Monitor and Adjust: Track the performance of the initial phase and adjust operations as needed to optimize heat delivery and system efficiency.
Expected Outcome: A functional heat transmission highway that forms the foundation for future expansion and connects key users, providing a revenue stream to support the next phases.
Step 5: Expand to Domestic Buildings and Additional Heat Source
Purpose: With the main transmission line in place, the network can be expanded to serve residential buildings and integrate additional heat sources.
Activities:
- Connect Domestic Users: Gradually extend the green heat grid to include households, offering an affordable, sustainable, hassle-free heating option.
- Integrate Thermal Energy Storage: Add LTES to store surplus heat and increase system resilience, especially during peak demand periods.
Find out more about LTES here:
- Explore Additional Heat Sources: Incorporate waste heat from other local industries or renewable energy sources, further reducing heating costs and enhancing system sustainability.
Expected Outcome: A more extensive heat network that serves a broader range of users, providing a resilient, efficient and future-proof heating solution for the region.
Step 6: Realize a City-Wide Green Heat Grid
Purpose: Achieve the long-term vision of expanding the heat transmission highway to connect regional heat networks to urban areas, offering widespread access to affordable, clean heat.
Activities:
- Plan for City Integration: Develop a strategy for extending the transmission line to a nearby city, assessing the technical and economic implications.
- Engage Urban Stakeholders: Work closely with city authorities, real estate developers, and local communities to ensure alignment with urban development plans.
- Secure Long-Term Financing: Identify opportunities for long-term financing and investment partnerships that can support the expansion to city-wide coverage.
Expected Outcome: A regional heat transmission highway that has matured into a citywide heat network, providing sustainable heating options at scale and supporting regional Net Zero targets.
Conclusion
This guide provides local authorities and stakeholders with a clear, actionable framework to develop regional heat transmission highways, ensuring each phase—from feasibility studies to construction and expansion—is strategically planned. By following this approach, communities can unlock sustainable heating solutions, accelerate the transition to a low-carbon economy, and build a resilient, future-proof energy infrastructure.
